News Room

The Water Bond: A Gift of Public Funds to Private Corporation

This week, the Associated Press (AP) reported that a pistachio farmer in the Central Valley has filed a lawsuit alleging that the Westside Mutual Water Co. illegally profits by selling water to non-members. The Westside Mutual Water Co. is owned by billionaires Stewart and Linda Resnick, who control a 48 percent share of the publicly-funded Kern County Water Bank. In 2007, the Resnicks owned more than 755,868 acre-feet of water – twice the capacity of the massive Hetch-Hetchy reservoir that serves the city of San Francisco. Under California law, companies that sell water for a profit must register as public utilities and set rates with the oversight of the Public Utilities Commission (PUC); the Westside Mutual Water Co. is not registered with the PUC.

The AP report connected the lawsuit to a privatization clause included in the $11.14 billion water bond that will appear before voters this November. This clause would allow private companies to own water storage projects funded by the bond, essentially spending public funds to allow private companies to make profits on water. According to the report, Assemblymember Jared Huffman of San Rafael is considering introducing an amendment to remove the clause: “I don’t think anyone wants to see this become a gift of public funds to private corporations,” he said.

The privatization clause is one of many reasons why groups like the Planning and Conservation League, Sierra Club, and Food & Water Watch oppose the bond.